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ATCO vs. BX: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Financial - Investment Management sector have probably already heard of Atlas and Blackstone Group (BX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Both Atlas and Blackstone Group have a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. However, value investors will care about much more than just this.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

ATCO currently has a forward P/E ratio of 10.51, while BX has a forward P/E of 25.24. We also note that ATCO has a PEG ratio of 0.67. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. BX currently has a PEG ratio of 1.23.

Another notable valuation metric for ATCO is its P/B ratio of 0.97. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BX has a P/B of 4.11.

These metrics, and several others, help ATCO earn a Value grade of A, while BX has been given a Value grade of F.

Both ATCO and BX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that ATCO is the superior value option right now.


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